Capital First Limited BOW NCD (IFC-39031)

Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Active
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
May 25, 2017
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
Capital First Limited
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 52.86 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Aug 1, 2018

Disclosed by Bank Apr 21, 2017

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

The project involves IFC financing of up to INR 3.4 billion (US$50 million equivalent) to Capital First Limited (“CFL” or the “Company”), aSystemically Important Non-Deposit Accepting Non-Banking Financial Company in India. The funding will be used for financing the growth of CFL’s lending portfolio to women-owned small and medium enterprises (“WSMEs”). This investment is part of IFC’s strategic target to reach 10 million MSMEs during FY17-21.

CFL serves micro, small and medium enterprises (“MSMEs”) and fast-growing emerging middle class consumers in India. Ithas a highly diversified loan book of INR188.00 billion (US$2.8 billion equivalent) as of December 31, 2016, of which 91% consists of MSME and consumer financing.The Company has financed 3.5 million customers to-date in 222 locations, including low-income states, across India.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

CFL is a publicly listed company. Its major shareholder is Warburg Pincus, which through its affiliated funds collectively holds 61.09% of the Company’s equity as of December 2016. Other shareholders of the Company include financial investors such as Goldman Sachs Asset Management, GIC (the Sovereign Wealth Fund of the Government of Singapore), HDFC Standard Life, Government Pension Fund Global (Norges Bank Investment Management), Birla Asset Management, Ashburton, Ashmore and other leading global and domestic institutional investors. The Company’s long term credit rating is AAA.

Mr. V. Vaidyanathan founded the company by a management buyout backed by Warburg Pincus and has been the Chairman and Managing Director of CFL since September 2012. He has transformed the Company into one of the leading players in the MSME and consumer financing space in India.

This is the second IFC debt investment in the Company; the first debt investment of INR 3.5 billion (US$52.5 million equivalent) was completed in 2016.

Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

CFL is a publicly listed company. Its major shareholder is Warburg Pincus, which through its affiliated funds collectively holds 61.09% of the Company’s equity as of December 2016. Other shareholders of the Company include financial investors such as Goldman Sachs Asset Management, GIC (the Sovereign Wealth Fund of the Government of Singapore), HDFC Standard Life, Government Pension Fund Global (Norges Bank Investment Management), Birla Asset Management, Ashburton, Ashmore and other leading global and domestic institutional investors. The Company’s long term credit rating is AAA.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/

CONTACTS

Capital First Limited
Saptarshi Bapari
Head – Strategic Initiatives & Investor Relations
+91 (22) 4042 3400
saptarshi.bapari@capitalfirst.com
One Indiabulls Centre, Tower 2A & 2B, 10th floor, Senapati Bapat Marg, Lower Parel (W), Mumbai
www.capitalfirst.com

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How it works